Google, TiVo & Best Buy Rally for AllVid

LR Cable News Analysis Jeff Baumgartner, Senior Editor, Light Reading 2/17/2011

A group representing some big names in the consumer electronics and retail industries are ganging up to put pressure on the Federal Communications Commission (FCC) to turn its AllVid inquiry into a full-fledged rule-making proceeding that could result in network-agnostic video adapters and gateways.

The founding members of the new lobbying group, called the AllVid Tech Company Alliance, include Best Buy, Google (Nasdaq: GOOG), Mitsubishi Digital Electronics, Nagravision SA , SageTV, Sony Corp. (NYSE: SNE) and TiVo Inc. (Nasdaq: TIVO). (See CE Guys, Retailers Form AllVid Alliance.)

They're all in support of an AllVid gateway approach with the aim of creating an easier path for vendors to build retail video devices that can support subscription TV services from all forms of multichannel video programming distributors (MVPDs), including cable MSOs, telcos and satellite providers.

With ties to its National Broadband Plan, the FCC's looking at AllVid regime as the successor to the CableCARD. Its hope is that a new breed of agnostic, IP-based "smart" video gateways capable of blending traditional MVPD services with Web-fed video will help to boost broadband adoption

The cable industry, along with parties such as DirecTV Group Inc. (NYSE: DTV), is opposed to AllVid because it believes government mandates will slow innovation to a crawl. The National Cable & Telecommunications Association (NCTA) has called on the FCC to scrap it because it thinks the market is evolving on its own without federal interference, citing Comcast Corp. (Nasdaq: CMCSA, CMCSK)'s and Time Warner Cable Inc. (NYSE: TWC)'s deals to offer video services on connected TVs from Samsung Electronics Co. Ltd. (Korea: SEC) (and TW Cable's similar deal with Sony) as recent examples.

In a letter to FCC Chairman Julius Genachowski, the Alliance applauded the cable sector's recent efforts, but claimed they still fall short of sparking a competitive retail environment for video devices.

"Internet Protocol," the Alliance noted [italics represent their emphasis], "is a key to finally enabling a wide range of home network devices to access MVPD programming offerings and services, but Internet program delivery is not a substitute for device competition in connecting consumers to full multichannel programming and services."

Why this matters
The FCC has yet to act on AllVid, so strong lobbies from both sides of the fence are now growing, desperate in their attempts to push the Commission over the top or get it to pull back the reins.

Some industry observers are surprised that the FCC has yet to put AllVid up as a proposed rule-making, fueling rumors that the FCC may be having second thoughts.

Both sides have a lot to lose, or gain, depending on which way the FCC leans. The service providers remain somewhat hesitant to move ahead with their own gateway plans without any certainty on what the FCC will or won't do. The pro-AllVid camp, meanwhile, sees this as the way to open up the market.

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— Jeff Baumgartner, Site Editor, Light Reading Cable